No further devaluation, RBF assures

June 04, 2009 09:59:54 AM

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Fiji’s Reserve Bank said there will be no further devaluation of the Fiji dollar.

The central bank said the Fiji dollar was now competitive and should be attractive to tourists after a 20 percent devaluation last month.

It added the currency would also be more attractive now for foreign importers to buy goods from Fiji.

In a statement to clarify the statement of Fiji’s economy, in response to the ADB report ‘Pacific Economic Monitor’, the RBF said the forecast contraction of the local economy by 0.3 per cent this year was a result of the worsening global economic and financial conditions and the January flooding.

The bank said had it not been for the floods, Fiji would have recorded a marginal growth this year.

“The contraction projected for the Fiji economy is milder than that being experienced by Fiji’s major trading partner countries,” the RBF said.

“The bank is optimistic that the economy will rebound next year to a modest recovery,” it said.

The RBF said although visitor arrivals declined in the first quarter, indications were that the decline may now be slowing down, supported by extensive marketing.

“Hence, the bank expects visitor arrivals to fall by a smaller magnitude by the end of the year. With the start of the peak season for the industry, as well as the devalued Fiji dollar, visitor arrivals should pick up in the coming months.”

Meanwhile, the RBF would be conducting road-show presentations and meetings with various stakeholders to explain the rationale behind its recent policies.

The bank stressed reliance on domestic goods and services, at the same time calling for increased effort at raising the level of exports from Fiji.

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